Leonaitis v. State Farm Mut. Auto. Ins. Co.

• Decision Date: 04 April 1988
• Docket Number: No. 76304,76304
• Citation: 186 Ga.App. 854,368 S.E.2d 775
• Parties: LEONAITIS v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY.
• Court: Georgia Court of Appeals

Page 775

368 S.E.2d 775

186 Ga.App. 854

LEONAITIS v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY.

No. 76304.

Court of Appeals of Georgia.

April 4, 1988.

Rehearing Denied April 18, 1988.

Certiorari Denied June 9, 1988.

Gregson T. Haan, John G. McCullough, Atlanta, for appellant.

Thomas D. Harper, Atlanta, for appellee.

DEEN, Presiding Judge.

On September 14, 1980, appellant, who was president and majority stockholder of Ardex, Ltd., was involved in an automobile accident which left him disabled for approximately ten months. During his disability period he received $2,604.92 in loss of income benefits under an insurance policy issued by Southern Guaranty Insurance Co., and $24,969.96 as 85 percent loss of income benefits as required by OCGA § 33-34-5(a)(1)(B) under his automobile insurance policy with State Farm. He brought an action against State Farm, contending that as 80 percent shareholder of Ardex, he was entitled to receive 80 percent of the net operating income of Ardex and that a reduction in the retained earnings of the corporation as calculated one year after the accident should justify a further payment of $16,447.84. His salary from Ardex for the previous year, which he alone determined annually, was approximately $40,000. There is no evidence that he received income from any source other than his salary. Summary judgment was granted in favor of the insurance company, and Leonaitis appeals.

1. The trial court did not err in denying appellant's motion in limine requesting an order that evidence of the reduction in earnings of the corporation owned and operated by him is admissible as evidence of his true loss of income. To grant appellant's request the court would have to disregard the existence of the corporate entity. Appellant chose to operate his business in corporate form and to pay himself a salary as his share of the corporate income. His reliance upon Smith v. State Farm, etc., Ins. Co., 152 Ga.App. 825, 264 S.E.2d 296 (1979), is misplaced, as this court's holding that there was evidence that a jury could find that certain earnings of appellant's late husband's business could be found to be attributed to her was reversed by the Supreme Court at 245 Ga. 654, 266 S.E.2d 505 (1980). Moreover, in that case, the business was not operated in corporate form, and the net profits from the business were deposited into a joint checking account.

2. Summary judgment in favor of appellee was proper simply because appellant failed to come forward with any evidence beyond his bare allegations, in the complaint and in his affidavit, that he had any other income on the date of his accident, which would be covered under the policy issued by appellee. In support of its motion for summary judgment, appellee showed that it was undisputed that at the time of the accident, appellant was a salaried employee of Ardex, Ltd., and that appellee had paid appellant 85 percent of his salary from that corporation during his period of disability. Appellee further contended that appellant had not established any other loss of income in a legally sufficient manner. Although appellant stated in his affidavit submitted in opposition to the motion for summary judgment that at the time of the accident he was engaged in various personal and family business matters from which he earned income, he testified at his deposition that he never submitted any documents to appellee to substantiate this claim, and admitted in his deposition testimony that it would be very difficult for him to say what his losses actually were. Further, the...